Government worker pay demands unreasonable; they are overpaid

There's the myth South Africa's public sector workers earn too little. This is behind their demands for above-inflation increases. Last year government gave in to their demands and gave them 7% increase. This was unfunded and, together with the also unbudgeted continuation of the emergency R350 grant, caused budget cuts nationwide.

The latest sector to demand increases are university workers. Last month it was University of Cape Town, these past few weeks University of Pretoria. Both demand above 7%. Inflation is 5.3%. UCT workers objected to the no work, no pay rule. To expect to be paid while on strike is symptomatic of Cosatu-affiliated unions' entitlement and don't-give-a-toss attitude. It was unreasonable as was their demand for 7.5% at this time of a cut in public funds.

Workers at both universities are affiliated to Nehawu. Strikers disrupted UP. It closed its gates causing inconvenience on the first day of lectures last week. This week they caused further problems.

Some are sympathetic to workers' demands for an above-inflation increases and say it's reasonable considering inflation in January was 5.3% and food inflation was 7.2%.

Inflation, or CPI, is (typically but not in SA's public sector which does its own thing) the basis for wage and price increases. Food, like other goods and services, is already calculated in CPI, an aggregate figure. Anyway, as far as the unions and government is concerned, inflation is merely a guideline. 

There's nothing reasonable about wanting above inflation unless there's a very good reason. SA is partly in this financial mess because for 30 years public sector workers have received above-inflation increases despite their posts not deserving it and offering decreasing value for money to taxpayers and citizens. But the ANC can't say no to their alliance partner COSATU and core voters whom they buy with high, undeserved wages and grants at taxpayer expense.

This year's budget speech showed 60% of government expenditure is on employee costs and grants.

Almost all government departments are experiencing budget cuts, universities too. This was due to last year's unfunded wage increases and emergency grants extension, and lower tax revenues due to the poor economy. Last year finance minister Enoch Godongwana had to walk-back his comments these were unaffordable after ANC criticism. Despite Treasury being one of the few - two or three - competent departments in the entire government, he too is playing silly buggers with the country's financial future.

So here we are. Because public workers, the post-1994 elite, don't know how lucky they are to have jobs when the real rate of unemployment is 42%, the entire county must pay the bill. Public workers, a bloated workforce, earn, by some estimates, 30% or more than their private sector peers for the same or similar posts. (For informal workers, the gap is a much higher.) The average government worker earns R465 000 a year, and half of all workers earn over R350 000.

Therefore, university workers, including academics, earn well by SA standards, and the work is not particularly stringent (lecturers, two or three lectures a day). 

Incidentally, in 2019, as an exercise to refute Western Cape Health Department's then head Dr Beth Engelbrecht's false statement to the WC legislature that WCHD's budget had been reduced for four successive years - it hadn't, increasing almost twice inflation, around 8%pa for the five preceding years - I reviewed the financials for 2018/2019 and found the average WCHD worker annual income (total employee cost divided by employees, about 30 000) was over R700 000. Based on employee cost of about 52% of total budget, WCHD's employee to operational efficiency had declined over the five years. 

By international standards, SA workers are well compensated. Global labour cost ranking index places SA 38th highest out of 60 countries for worker compensation. SA is higher than many developed economies, surprisingly US included which is three places below at 41st. Japan has the lowest labour cost and Ukraine the highest. The problem is SA's labour force is not particularly productive, below the world average, public workers among the worst.

Striking university Nehawu workers are well paid, similar to other government employees. SA's labour economics problem is not necessarily low pay but a variety of more important concurrent issues the ANC neglected and allowed to grow for 25 years while they fleeced the country, hide the cash in sofas and on jets bound for Dubai. The country is seeing the results clearly only recently. 

Striking Nehawu and its affiliated Cosatu workers don't deserve sympathy. They're among the parasites - the "looters and pie-in-the-sky promisers of paradise" - that have brought SA to where it is. Only once these looters and parasites are gone then we'd be able to begin mitigating the damaged Cosatu's unrestricted, conceded to demands and at time criminal actions they've wrought. 

When the ANC wins the election, as they will, scraping through with or without a coalition partner, in five years time we'll look back to 2024 and say we weren't as badly off as we are now (2029) - economically, socially, internationally - with the country bankrupt and every public space and facility broken. The trend is already clear.

We're in for a rough ride.